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Has California school and community college facility construction become a perpetual government stimulus program for politically-favored construction trade unions?

Fifteen years ago, it was obvious that many school and college districts in California needed new construction, modernization, or renovation of their facilities for the safety and comfort of students, teachers, administrators, and support staff. That’s why 53% of California voters approved Proposition 39 in November 2000. It reduced the threshold for voter approval of school bond measures from two-thirds to 55%, increasing the passage rate for educational bond measures from under 50% to more than 80%.

But the purpose of borrowing money for school construction seemed to evolve after the 2008 economic collapse and subsequent November 2008 election.

Debt started piling up from relentless and repeated bond sales to investors. The “need” for more construction seemed immeasurable and unquenchable. Scandals began to pop up as clever people began to figure out how to manipulate the loopholes and ambiguities in ten year-old state laws regarding finance and construction of educational facilities.

Meanwhile, construction trade unions became much more aggressive in trying to monopolize educational construction by lobbying elected school board members for Project Labor Agreements. And local school and college elected boards became much more willing to grant those union monopolies.

Local elected officials in California recognized that political circumstances had changed. To quote a San Diego Unified School District board member immediately before the 3-2 vote on May 26, 2009 for a Project Labor Agreement:

I think the bigger picture that people are realizing – and this is what scares some people – is that San Diego is changing, the United States is changing…this is a different city…we are looking at a different community.

What has resulted from this change? A lot of debt has been imposed on future generations of Californians.

In response to this report, some taxpayer advocates have asserted that momentum for additional local educational bond measures is propelled by construction trade unions that see local education districts as ripe targets to accumulate a pool of guaranteed government work. Union leaders remain nervous about the state’s economic prospects. They don’t want a painful revival of membership unemployment rates of 25%-50% experienced from 2009 to 2012.

Is this argument valid?

Below is a list of all of the K-12 school and college bond measures approved by voters in the last four primary and general elections (in 2012 and 2014) that became targets of construction unions for a government-mandated Project Labor Agreement (PLA).

Bond Measures Approved by Voters in June 2012

Amount Authorized to Borrow

Name of School or College District

Voter Approval Percentage

Project Labor Agreement Activity

West Valley-Mission Community College District

$350,000,000

59.8%

Board approves PLA for upcoming “pilot project” 8/20/13.

Milpitas Unified School District

$95,000,000

64.1%

Board approves PLA 12/11/12.

Bond Measures Approved by Voters in November 2012

San Diego Unified School District

$2,800,000,000

61.8%

PLA approved in 2009 extends to this bond measure.

Coast Community College District

$698,000,000

57.2%

Board votes 5/15/13 to end consideration of a PLA.

Oakland Unified School District

$475,000,000

84.4%

PLA approved in 2004 extends to this bond measure.

Santa Monica-Malibu Unified School District

$385,000,000

68.1%

Board discusses PLA 11/20/14.

Board votes for contract to negotiate PLA 4/16/15.

West Contra Costa Unified School District

$360,000,000

64.4%

PLA approved in 2000 extends to all bond measures.

Cerritos Community College District

$350,000,000

70.3%

Board discusses PLA 4/16/14 and 6/4/14.

Solano Community College District

$348,000,000

63.5%

Board approves PLA 12/4/13.

Sacramento City Unified School District

$346,000,000

70.1%

Board votes 1/23/14 to extend PLA approved in 2005 to this bond measure.

Rancho Santiago Community College District

$198,000,000

72.6%

Board approves PLA 3/24/14.

Alum Rock Union Elementary School District

$125,000,000

79.5%

Board approves PLA 6/18/13.

East Side Union High School District

$120,000,000

71.6%

Revised PLA approved in 2009 extends to this bond measure.

Lynwood Unified School District

$93,000,000

57.4%

Board approves PLA 2/12/13.

Inglewood Unified School District

$90,000,000

86.1%

Board approves PLA 10/26/12.

Chula Vista Elementary School District SFID No. 1

$90,000,000

68.8%

Board approves negotiations for a PLA 4/15/15.

Oxnard School District

$90,000,000

66.4%

Board approves PLA 6/24/15.

Sacramento City Unified School District

$68,000,000

67.9%

Board votes 1/23/14 to extend PLA approved in 2005 to this bond measure.

Antioch Unified School District SFID No. 1

$56,500,000

62.8%

Board approves PLA 11/13/13.

Whittier City Unified School District

$55,000,000

72.4%

Board approves PLA 1/13/15.

Washington Unified School District

$22,000,000

72.8%

Board imposed a union-backed apprenticeship requirement for contractors and used it to disqualify non-union company from contract.

Board imposed a union-backed apprenticeship requirement for contractors and used to disqualify non-union company from contract.

Bassett Unified School District

$30,000,000

62.4%

Board voted for PLA negotiations 1/20/15.

Kevin Dayton is the President & CEO of Labor Issues Solutions, LLC, and is the author of frequent postings about generally unreported California state and local policy issues at www.laborissuessolutions.com. Follow him on Twitter at @DaytonPubPolicy.

Among the many Californians who only occasionally vote in elections, how many understand what they’re doing when they vote for a “bond measure” for a K-12 school district or community college district? They know it’s “for the kids,” but do they know that when they authorize a school district to sell bonds to fund construction, it is borrowing money from institutional investors and wealthy individuals? Do they consider the cost implications, such as how this borrowed money must be paid back – with interest – directly through the taxes of property owners and indirectly through rent and lease payments to landlords?

Presidential elections attract the highest voter turnouts, and as a greater number of people vote, a higher proportion of them are a little fuzzy on some of the policy details. They tend to vote on emotional impulses and are more likely to respond favorably to simple arguments such as “it’s for the kids.” It’s conventional wisdom among California political consultants that voters in Presidential general elections tend to be more likely than voters in primary or off-year elections to approve ballot measures that authorize bond sales.

School agencies have qualified 106 school facilities ballot measures worth a total of $11.6 billion for the November election. This eclipses the previous high number of measures, 96, which occurred in November 2008. Included within that total are two traditional general obligation (GO) bonds requiring a two-thirds majority vote for passage and 104 Proposition 39 measures requiring a 55% majority approval. The measures are broad-based, including eight community college elections and four school facility improvement district (SFID) elections. They also extend to every corner of the state.

The article also makes some election predictions:

If past trends hold true, more than 70% of the school agency measures on the ballot will pass. But every election is different, and in this one, voters are faced with a hotly contested presidential election, two major school funding measures, a number of high-profile, very controversial measures, and we are still caught in the throes of economic malaise. Our prediction, therefore, is that voters will go to the polls and support passage of these measures and that the results will be even better than recent history would suggest. Our experience is that when times get tough, voters are much more likely to take matters in their own hands and turn to the local ballot box, not the state, for support for their children.

Obviously, $11.6 billion in taxpayer money (not including state matching grants) attracts special interests looking to get themselves a guaranteed piece of the action. These interests, of course, include construction trade unions.

So which of California’s K-12 school districts and community college districts with bond measures for construction on the November 2012 ballot have a history of requiring their construction contractors to sign Project Labor Agreements (PLAs) with trade unions as a condition of working on projects funded by bond measures? Quite a few:

In addition, school boards of three other school districts with bond measures on the November 6, 2012 ballot have been lobbied aggressively in the past by union officials for a Project Labor Agreement. These will certainly remain targets for Project Labor Agreements:

San Jose Unified District (2003)

$290 million

San Bernardino City Unified School District (2010)

$250 million

Jefferson Union High School District (2007)

$41.9 million

Finally, the Stockton Unified School District approved a resolution in 2007 requiring contractors to obtain apprentices from eligible state-approved training programs that have “graduated apprentices annually for at least the past five (5) years.” The policy was aimed at non-union (and union) apprenticeship programs that the state might approve in the future to compete against existing union apprenticeship programs. Apprentices in those new programs would not be allowed to get on-the-job training on Stockton Unified School District construction projects.

Stockton Unified School District

$156 million

If predictions are correct about the November 2012 election results for bond measures, construction unions throughout the state will have plenty of work guaranteed through government-mandated Project Labor Agreements and other tricky arrangements to get union monopolies on taxpayer-funded construction. Keep in mind that many of these school districts will also obtain matching grants for these projects from the State Allocation Board – grants funded by bond sales totaling $35.8 billion authorized by three past statewide propositions:

Want more documentation? Below is a list of Project Labor Agreements that contractors have been required or will be required to sign to work on school construction, along with links to the actual agreements.

Government-Mandated Project Labor Agreements for K-12 School and Community College Construction Projects

Seven Schools (Including Creekside Elementary School) of San Ramon Valley Unified School District Project Labor Agreement between Shapell Industries and Windemere and UA Plumbers and Steamfitters Union Local 159 and International Brotherhood of Electrical Workers Union Local 302 (copy not in my possession)